A Comprehensive Approach To Blockchain Security

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The vocabulary of an ordinary person is constantly replenished with terms that come into his real world from the virtual world. “Web 3.0”, “blockchain application”, “decentralization” - these are just a small part of those definitions that recently belonged only to a narrow circle of specialists, and now increasingly occupy the minds of ordinary citizens.

And this is not accidental, because the more we come into contact with the virtual world in everyday life, the more we want to understand its tasks, benefits and necessity for each of us. For example, within the framework of the most popular innovative technology, blockchain, the question is constantly asked: for what purposes was this technology created?

The answer to this question is obvious: the goal of blockchain technology is to create all kinds of decentralized applications. The application is the result for which blockchain technology works, blockchain networks and blockchain platforms are created, partner companies and counterparty companies are united within a single trusted network. Figuratively speaking, an application is a kind of cherry on the cake of web projects.

The essence of the term “web application” is simple; it is nothing more than software that can interact with the user and perform a variety of tasks. Now let’s imagine that a certain company has set itself the task of implementing its web projects based on the blockchain network.

Of course, for the purposes of blockchain app development, the company needs to plan and implement a whole range of various measures and solutions in order to ensure quality trouble proof and safe operation of decentralized applications.

Threat system segments

One of the most discussed topics related to blockchain applications is the topic of security. When talking about the security of blockchain applications, especially at the corporate level, you need to clearly understand that this is only a visible part of a whole range of factors that create risks and threats. Security, as a category, should cover not only and not so much the application itself, but at the same time the very infrastructure associated with this application.

Threat system segments

The issue of information security today worries developers, company users, individual users and business in general. The reason lies in the fact that we are all, one way or another, step by step moving towards virtual remote processes, when people, businesses, companies and even entire industries work and interact in many cases online. And this trend, unfortunately, leads not only to positive aspects, but also to those negative factors that create a large number of security-related problems in the virtual world.

And this is becoming more and more obvious due to the fact that “big money” is circulating among various blockchain solutions, which is a tasty bait for all kinds of cyber scammers. What decisions need to be taken into account as part of ensuring information security, what measures need to be followed and what situations need to be avoided - these are the tasks that every developer and user of blockchain applications faces today.

First, it is necessary to identify and systematize those threats and risks that affect security, which form a certain system of threats common to blockchain applications. Take, for example, a standard blockchain network that consists of five nodes. In this case, the number of nodes does not play a big role; there can be much more.

The main thing is that environments for executing smart contracts are deployed on our conditional nodes, and business applications that are integrated with these nodes are deployed on a certain number of nodes. Based on this, the threats that may arise from such a solution can be divided into several segments.

1. System segment

The first segment includes threats aimed at applications. These threats can be divided into two categories of risks: risks for software and risks arising due to one or another human influence, which are always present when working with applications.

2. System segment

The second segment of threats is aimed at the blockchain itself. It is known that the blockchain, in fact, is a kind of guiding corridor for the flow of transactions. In addition, blockchain is also necessary both for calling smart contracts and for obtaining the results of their execution.

In this case, all security risks must be taken into account by the software developer. This means that no step in the product development life cycle should be allowed to pass without addressing risks and threats.

3. System segment

The third segment in the threat system is threats that can affect smart contracts. It should be noted here that the main sources of these threats are most often compilers. In addition to their vulnerability, various failures in business logic can also create problems.

4. System segment

The fourth and often most important segment of threats is related to the blockchain network infrastructure. Strictly speaking, other positions included in the blockchain network cannot be insured against the problems that are inherent in the infrastructure. It is always necessary to remember this and pay maximum attention to this segment.

When analyzing the sources of risks and threats, it was noted that very often a person acts as a factor contributing to the emergence of security problems. That is, all sorts of mistakes by specialists, their lack of competence, lack of practical experience, etc. can make a hole even in a well-built security system of the development life cycle.

Counteract measures

Since we were talking about a certain system that includes several segments of a wide variety of risks and threats aimed at the vulnerabilities of the blockchain network, we should also note some measures that can counteract these information attacks. Let's start with the fact that when a private blockchain network is operating, an unauthorized connection to it may occur. 

Counteract measures

In other words, if a private network, for example, has five nodes, then the sixth node cannot connect without the permission of this network. Such permission can be issued either by an authorized user, or by the owner, or by the network operator, who represents the collegial body that manages this network. If this does not happen, then an unauthorized connection to the network may lead to data leakage.

In addition, the result of an unauthorized connection by attackers can be a complete takeover of the network. To prevent this threat, it is necessary to develop a special mechanism for controlling access to a private network. Such a mechanism can work through a certain type of transaction that is recorded on the blockchain and in which the public key is entered to get access to the blockchain.

The transaction must propagate to all network participants who accept the request from the new participant. In this case, the request is signed with the private key of the new participant, and this private key must match the public key recorded in the transaction. Only after this can network participants approve the request and establish a connection with the new participant.

The next risk for the blockchain network may be related to unauthorized access to data. This can happen in cases where the host's software interfaces are not protected. To ensure blockchain security in such situations, it is necessary to think, first of all, about developing a special authorization service, with the help of which you can control access of different users to various software interfaces. 

The use of different data access policies is also encouraged. There is also often a ban on connecting an API node from the Internet. The risk of unauthorized access to the computer hardware on which the node operates is quite common. The result of this risk may be gaining access to confidential information and the node's key pair. Prevention of such external interference is considered a top priority and is most often the responsibility of the company's security service.

However, in such a situation, additional countermeasures can also be taken. Firstly, all confidential information can be placed in a secure circuit. To the implementation of these measures, a requirement may be added to the mandatory encryption of all confidential information. In cases where maintaining confidentiality is a question in companies with state participation, it would be good practice to use certified information security tools.

Vulnerabilities of applications and smart contracts

Vulnerabilities of applications and smart contracts

Risks and threats that various blockchain applications may be exposed to:

  • Vulnerabilities of the software itself;
  • Access to computer facilities;
  • Unauthorized access to data;
  • Access to confidential information by a user without authorized access;
  • Disclosure of confidential information by an authorized user.

To prevent and counteract such problems, the following measures are the most appropriate:

  • Testing the application source code;
  • Penetration testing;
  • Use of authorization to access data;
  • Data encryption;
  • Use of certified information security tools;
  • Access control at the application level;
  • Various preventive and reactive organizational actions.
  • We list the vulnerabilities of smart contracts:
  • Business logic errors;
  • Malware in a container with a smart contract;
  • Replacing the contents of containers;
  • DoS attack on network nodes through smart contracts;
  • Unauthorized access to confidential information.

Countermeasures for such threats are as follows:

  • Audit of smart contracts;
  • Use of a smart contract constructor;
  • Correct configuration of the image with the smart contract;
  • Vulnerability testing;
  • Use of a hash image verification mechanism when downloading and deploying a smart contract;
  • Network monitoring;
  • Blocking violators;
  • Separation of the node and the machine for executing contracts;
  • Use of encryption.
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